UCI

Housing Market

Orange County residents are feeling very bullish about the local housing market. This year, three in four homeowners say buying a home here is an excellent or good investment, while 18% call it fair and only 5% say poor. Among those who rent, 61% believe that owning a home in Orange County would be an excellent or good investment, 25% say fair and 12% call it poor. The number who think a home in Orange County is a favorable investment is up five points among homeowners since last year, 15 points in two years and 25 points in three years. Homeowners are the most optimistic about owning an Orange County home as an investment since we began asking the question in 1993.
Graph: Orange County Home as an Investment: Owners

Among renters, the number who consider buying a house in Orange County to be an excellent or good investment also has risen five points since last year and 16 points in two years. Since 1995, the positive ratings have climbed 20 points. Renters are more confident about the Orange County housing market now than at any time since we began asking this question in 1993.
Graph: Orange County Home as an Investment: Renters

Sixty-three percent of homeowners and 56% of renters pay more than $750 a month for their housing. For this study, renters are broadly defined as those renting apartments, attached homes, mobile homes or single-family homes. The proportion of homeowners paying more than $750 is the same as in 1996 and 1997. This may reflect the effects of low mortgage rates on refinancing and new and resale home purchases. However, the proportion of renters paying more than $750 has risen by eight points since last year and by 12 points since 1996. This trend indicates a tight rental market. The median monthly mortgage payment is $964 this year, and the median monthly rent is $795. Mortgages are up slightly from last year's median of $948 and are similar to the 1996 median of $960. On the other hand, rents are up sharply from the 1997 median of $735 and the 1996 median of $713. The trend is for increases in rental costs to outpace increases in mortgage costs.
Graph: Trends in Monthly Housing Payments (Payments of more than $750 per month)

South County has the most expensive housing for both homeowners and renters. Twenty-five percent of South County homeowners pay more than $1,500 a month in mortgage, compared with 16% of owners in North County. Forty-three percent of South County renters pay more than $1,000, compared with 18% of renters in North County. There are some important differences across racial and ethnic groups. Non-Hispanic whites are more likely than Latinos or Asians to own a home (70% vs. 42% vs. 58%), to live in single family homes (59% vs. 41% vs. 53%) and to live in their homes for more than five years (53% vs. 33% vs. 30%).